Posts Tagged ‘microsoft’

Yahoo (NSDQ: YHOO), which just announced buying online video tech provider Maven Networks, has quietly relaunched its consumer video service. The service, which has been retooled a few times and hasn’t been a big competition to the likes of YouTube and others, still has the traffic funnel of Yahoo, so has to be taken into contention. The service has a bigger player, better resolution, a better upload tool, and has some new tools for organizing content. This relaunch does not yet incorporate anything from Maven’s acquisition, but one would expect it to be part of the service down the line…which would probably mean an even higher quality video experience.

One missing thing for Yahoo is any kind of premium downloads. Would expect this not to be done in-house, and someone like Amazon (NSDQ: AMZN) through its Unbox service could be a partner…after all Amazon has been looking to do such powered-by deals of late.

As reported on paidcontent.org

Here’s the article on Yahoo’s Maven acquisition on paidcontent.org

Life goes on at Yahoo: the company has confirmed its previously rumored acquisition of online video platform Maven Networks, although the price tag of “approximately” $160 million is a bit higher than the previous $150 million estimate. The reports first surfaced on New TeeVee and TechCrunch on Jan. 31, the night before Microsoft (NSDQ: MSFT) launched its bid for Yahoo (NSDQ: YHOO). It’s not clear if the delay, however, between the initial reports and the official announcement had anything to do with the bigger issues facing the company. Cambridge, MA-based Maven offers a platform for high-res video hosting and distribution, as well as a system for video advertising. Release.

— Maven, which has raised $30 million, has relationships with a number of major content providers, including Fox News, Sony BMG, and “CBS” Sports. Backers include Prism Ventures, Accel Partners and General Catalyst. By comparison, Brightcove, whose CEO Jeremy Allaire was the EIR at General catalyst when the firm invested in Maven, has raised $80 million, since its launch in 2004.

— The company, now a wholly-owned subsidiary of Yahoo, will remain in Cambridge but becomes part of Hilary Schneider’s Global Partner Solutions group. Yahoo says it plans to invest in the growth of Maven’s overall video business and to expand Maven’s suite with “video monetization services” and “advanced technologies for delivering consumers more relevant advertising experiences.”

— David adds: I spoke with Maven CEO Hilmi Ozguc and Rebecca Paoletti, Yahoo’s director of video strategy/sales. More after the jump…

Both offered details of the complementary aspects of working together, especially as Yahoo prepares to relaunch its video network on Thursday. Both also said that the discussions between Yahoo and Maven occurred month’s before Microsoft’s $44.6 billion bid for Yahoo was floated. Ozguc said he regards the Microsoft talk as a side issue far removed from his and Yahoo’s current plans. As for how a Microsoft takeover might affect Maven down the road, Ozguc would only say, “Your guess is as good as mine.”

— A playing field of titans: The nascent stage of online video, which was dominated by startups, has passed, Ozguc said. Now it’s a “playing field of titans and we thought the time was right to become one of the biggest players in online advertising. It’s not just Yahoo’s display and search capabilities, but their deep relationships with publishers that made this such a good fit for us.”

— The combination: Maven manages the video distribution and ad trafficking for over 30 media companies with hundreds of affiliate sites within them. And Yahoo has licensing deals with roughly 75 percent of the major TV ad spenders. “It’s not that Yahoo didn’t have deals with many of the players that we do, but we’ve five years on creating a video publishing system. That technology is the other half of our value proposition. We’re a pure technology provider. We never got into ad sales or creating portals. It’s a very clean relationship from that perspective.”

— Maven brand stays (for now): Ozguc: “We’re still a well-known brand and there’s no reason to do away with it. That’s not to say that Yahoo won’t rebrand it. But the plan right now is to keep the name in place.” And even though the two companies are working on integrating each other’s workforces, Ozguc added that no layoffs are imminent. “That issue has been talked about and decided. Yahoo did not acquire this company to lay people off.”

The board decided the price “massively undervalues” the Sunnyvale, California-based company, and Yahoo may face risks because regulators could oppose the combination, the newspaper said today. On Feb. 1, Microsoft offered $31 a share in cash and stock for Yahoo. The company wants at least $40, or more than $12 billion more than Microsoft offered, the Journal said.

Chief Executive Officer Jerry Yang, who said this week that Yahoo is examining its options, may consider a partnership with bigger rival Google Inc. or ways to wrest a higher offer from Microsoft. Yahoo’s failure to crack Google’s dominance in search led to eight straight profit declines and cut the stock’s value in half in the two years before the offer.

“Yahoo still has one of the largest brands on the Internet,” Bill Tancer, general manager at researcher Hitwise Pty. in San Francisco, said in an interview before the report. “It confines Google to continue to grow their revenue from a single revenue stream, which is search.”

Yahoo directors, who met over the past week to weigh the offer, will send a letter to Redmond, Washington-based Microsoft on Monday that outlines its position, the Journal said.

Yahoo is betting Microsoft won’t take hostile measures to win the bid, the Journal said, even though the software maker has indicated that is a possibility. A person familiar with the matter said this week that Microsoft may seek to oust Yahoo board members should they reject its offer.

“Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal,” Microsoft CEO Steven Ballmer said in a letter to Yahoo’s board that was made public on Feb. 1.

The offer is 62 percent more than Yahoo’s stock price before the bid. The shares have climbed above the value of the cash-and- stock bid, showing shareholders expect a higher price. Microsoft plans to let investors choose cash or stock, at a ratio that will end up being about 50-50.

$34 to $37

Microsoft shares have declined since the bid, lowering the value of the stock portion and pushing the total value of the deal to about $29.08 a share. Microsoft may have to bid $34 to $37, said UBS AG’s Heather Bellini, the top-ranked software analyst by Institutional Investor magazine.

Since the bid is half cash and half stock, Microsoft may fix the offer at $31 before pursuing an increase, so the value doesn’t decline with its shares, she said.

Yahoo is getting financial advice from Goldman Sachs Group Inc., Lehman Brothers Holdings Inc. and Moelis & Co., according to two people familiar with the matter. Spokespeople for Goldman and Lehman declined to comment and a Moelis representative didn’t immediately return a phone call.

Morgan Stanley and Blackstone Group LP are counseling Microsoft.

Google Possibility

Yang, 39, has resisted letting go of the company he co- founded in 1995 as a graduate student at Stanford University. Initially a way to help people find their favorite places on the Web, Yahoo became the most-visited U.S. Internet site by combining search, news, sports and finance in a single place.

He replaced Terry Semel as chief in June after Yahoo’s share of Web searches tumbled and the company lost sales of banner ads.

Yahoo might seek help from rivals, soliciting other bids or seeking partnerships with Rupert Murdoch’s News Corp. or Google to thwart Microsoft, according to analysts including Stanford Group Co.’s Clayton Moran.

The New York Times reported Feb. 4 that Google CEO Eric Schmidt contacted Yang to suggest a partnership between their companies. A partnership with Google may allow Yahoo to outsource its search service, shedding the costs of running its own search engine and sharing ad revenue with its larger rival.

While a search and advertising partnership with Google is an option, it would face stiff regulatory scrutiny, Moran said. News Corp. isn’t interested in bidding for Yahoo, Murdoch said on a Feb. 4 conference call. That means Yang’s options probably won’t pan out, said Andrew Frank, a New York-based analyst at research firm Gartner Inc.

The U.S. Justice Department is “interested” in reviewing the antitrust implications of a Yahoo-Microsoft transaction, agency spokeswoman Gina Talamona said last week. Neelie Kroes, commissioner of competition for the European Commission, said her agency also would scrutinize a deal.

Google has grown faster than Microsoft in every quarter since Google’s 2004 initial public offering as its search engine won more users. Even after CEO Steve Ballmer’s efforts to build a new search engine from scratch, Google outsold Microsoft in Internet ads by 7-to-1 in Microsoft’s latest fiscal year.

Microsoft and Yahoo combined would still fail to seize the lead in Internet search. Google, based in Mountain View, California, got 56 percent of U.S. Web queries in December, which is almost double Yahoo and Microsoft’s shares together, according to New York-based Nielsen Online.

Microsoft and Yahoo! have been struggling ,as we all know, to monetize the real estate of the Internet World, i.e the Page Views. Where Microsoft lost about 250M$ in the online business last quarter, Yahoo also suffered a 23% drop in their net earnings in the same quarter. It’s not that these giants don’t know the business, they just seem helpless especially since they have no share in the strongest online business value chain, i.e. the Search. No wonder google still raked in a kewl 17% increase in their annual revenue.

While Microsoft was busy writing petitions against a possible buyout of double click by Google, Yahoo was busy firing its employees and trying to lower the opex to show healthy earnings to its investors

But Investors are smart and they can clearly see the Armageddon. They know that Dinosaurs did extinct and so can Yahoo.

But was Yahoo sleeping the whole time? No

Jerry Yang,Mr Yahoo, tried to reinvigorate life back in Yahoo management by calling a 100 day management review last year in July. Here’s a presentation

Irony is that do u really need a 100 days to identify a disease that has such visible side effects. When you don’t have a share in the Search market, no matter if your clicking Trillion page views you just cant make money. For the four weeks ending in January 2008, Google accounted for 65.98% of U.S. searches, while Yahoo! and Microsoft combined amounted to just 27.84% of searches.

The second big question for Yahoo has been how to enter the SNS market. But Can you really sell the concept of making money by doing SNS now to Investors, NO? You could have 2 yrs back,but you wont have the back of your investors to invest into the SNS space especially When Google’s struggling to monetize their Myspace inventory

So does this mean the quest to make money on Social networking sites is never ending?

Well Microsoft seems to think otherwise, especially since they’ve been acting happy about their investment and the advertising deal with Facebook. Hmmmmm……

Does all this hint that Google is the Achilles with out the week heel ?

O Sorry, not yet the Giants are trying their Last move…..lets wait until then…

Social networking is one of the biggest and fastest-evolving phenomena on the Web, and Microsoft’s proposed takeover of Yahoo will undoubtedly send it in new directions. More than anything, a MSFT-YHOO acquisition will shake up the debate over just how you can make money off a Facebook or MySpace.com–because they’re running out of time to figure that out.

Should the Microsoft-Yahoo acquisition go through, expect them to try to corner the social-network advertising market.

The common wisdom is that neither Microsoft nor Yahoo is a real force in social networking. Both companies own multiple social media properties, and the only resounding success among them is Yahoo’s Flickr. (Sorry, Microsoft, I’m not counting the Zune’s “song-squirting.”) “They’re very interested in the space,” Forrester Research analyst Charlene Li said in an interview with CNET News.com. “They haven’t been able to get traction in it. They look at it very longingly.”

Social networking, in addition, will be a tasty slice of the Web for a hypothetical Microsoft-Yahoo because it’s also one of the few niches of the Web on which Google doesn’t already have a stranglehold. Its OpenSocial developer initiative isn’t ready yet, its Orkut social network has only gained traction in a few regions of the globe, and the company admitted in its recent quarterly earnings call that social advertising (specifically on News Corp.’s MySpace) isn’t bringing home the bacon.

Taking the reins on the advertising market is probably the best way for Microsoft-Yahoo to make waves in social networking without actually launching a big social-media initiative–and I certainly hope they don’t try to, because there are way too many networks out there already. Microsoft already has a foot in the door with its $240 million stake in Facebook. (Yahoo tried to acquire it outright in 2006 and was promptly spurned.) And Facebook’s own Social Ads were met with high-profile opposition and plenty of bad press.

With Microsoft’s and Yahoo’s resources pooled, the two companies could devise a more effective social advertising strategy (if such a thing is even possible). Even if it’s dubious in its effectiveness, expect it to be very high profile. Think about it: Microsoft-Yahoo could claim they’re doing what Google couldn’t do. How’s that for instilling confidence?

“A potential acquisition, if it actually goes through, could be a much, much more interesting player for Facebook to want to do business with,” Li said, noting that Facebook’s current deal with Microsoft only covers display advertisements, not search ads. “If Microsoft and Yahoo can actually make a play in search, that makes Facebook a lot more comfortable going with an all-Microsoft deal and maybe even be acquired by it. Who knows?”

But beyond advertising, a combined Microsoft-Yahoo has a massive social-networking tool at its fingertips, Li continued. “Yahoo and Microsoft both have this wonderful asset called e-mail address books and instant-messaging buddy lists, which are essentially a social graph,” she said. “A lot of people are using those services, much more so than Gmail, for example, and so that’s an instant social graph.”

The actual figure is $150 million which Facebook’s 23-year-old CEO Mark Zuckerberg revealed in a company wide open call. Obviously Mr Zuckerberg didn’t think that these details could be leaked.

The Times carried an article on how the leaked figures look like.
Overall, the details are pretty interesting and show how the company is bracing up for the future. They say that they are going to invest $200 million of expenditure which looks like to be mostly on storage capacity. With millions of photos on facebook, that’s sure going to be a good investment.

What obviously doesn’t come up here is whether Facebook would be making any acquisitions ? I myself would think that if they had a cash pile, then an overture(which was acquired by yahoo) like acquisition would be the best investment for them given that all of their earnings come from serving ads.

Its true that Microsoft handles it for them now but given that Facebook’s revenues are all from ads – I won’t keep something as important as that disassociated from the company.

Let’s see how’s facebook performing in the context of SNS advertising market

Here’s a presentation on SNS(facebook) market valuation …to help you understand where facebook stands today in the over all SNS advertising market…..